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Sec 291 of the Companies Act – Summary
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General Powers of the Board
Section 291 grants the Board of Directors the authority to exercise all powers of the company, including doing acts the company is authorized to do, subject to the provisions of the Act, the company's Articles of Association, and other legal restrictions. This section provides a broad empowerment for directors to manage the company's affairs effectively.
References: Ram Prasad Somani VS Bank of Rajasthan Ltd. - Rajasthan, Irrigation Development Employees association rep. by its General secretary VS Government Of A. P. , Public Enterprises - Andhra Pradesh, Behar Journals Ltd. VS H. K. Chaudhuri - Patna -
Specific Authorizations and Limitations
While Section 291 empowers the Board generally, certain actions such as instituting suits or representing the company in legal matters require specific resolutions passed by the Board. For example, in legal proceedings, a resolution must authorize particular directors or officers to act on behalf of the company.
References: L. P. Electronics (Orissa) Pvt. Ltd. VS Tirupati Electro Marketing Pvt. Ltd. - Orissa, Boc India Limited VS Zinc Products And Co. Pvt. Ltd. - Patna -
Legal Proceedings and Representation
The section emphasizes that the power to represent the company in litigation can only be delegated through a formal resolution by the Board, ensuring proper authority and accountability. This is critical in cases involving legal disputes, as unauthorized actions may be invalid.
References: L. P. Electronics (Orissa) Pvt. Ltd. VS Tirupati Electro Marketing Pvt. Ltd. - Orissa, Ram Prasad Somani VS Bank of Rajasthan Ltd. - Rajasthan -
Offenses and Responsibility
Offenses committed by the company, such as those under the Negotiable Instruments Act (e.g., dishonor of cheques), can implicate individuals like Managing Directors or officers responsible for the company's actions. Section 291 also relates to liability and the importance of proper authorization for legal actions.
References: K. K. Ahuja VS V. K. Vora - Orissa, P. Sudhavenkata Lakshmi VS Sree Chakra Cotton Company, rep. by its Sole Proprietor, Puvvadisuresh - Andhra Pradesh, Chemox Laboratories Ltd. VS Gujarat Narmada Valley Fertilisers Co. Ltd. - Dishonour Of Cheque -
Procedural Aspects and Court Proceedings
When filing suits or legal actions, proper resolutions under Section 291 are necessary to validate the company's authority to institute proceedings. Lack of such resolution can render legal actions invalid, as seen in cases involving winding-up petitions or injunctions.
References: Boc India Limited VS Zinc Products And Co. Pvt. Ltd. - Patna, Ram Prasad Somani VS Bank of Rajasthan Ltd. - Rajasthan -
Related Legal Frameworks
The section works alongside other legal provisions like the Civil Procedure Code (Order 39, Rule 1 & 2), and the Articles of Association, which may specify the extent of directors' powers and procedural requirements.
References: Ram Prasad Somani VS Bank of Rajasthan Ltd. - Rajasthan, FLOATING SERVICES LTD VS MV san FRANSCECO DIPALOLA - Gujarat
Analysis and Conclusion
Section 291 of the Companies Act provides a comprehensive framework empowering the Board of Directors to manage the company's affairs, including entering into legal actions, subject to specific procedural requirements. Proper resolutions are essential when the company needs to institute suits, represent itself in litigation, or undertake significant acts. The section ensures that the powers exercised by directors are lawful, documented, and within the scope of their authority, thereby safeguarding corporate governance and legal accountability.
References: - Ram Prasad Somani VS Bank of Rajasthan Ltd. - Rajasthan - L. P. Electronics (Orissa) Pvt. Ltd. VS Tirupati Electro Marketing Pvt. Ltd. - Orissa - K. K. Ahuja VS V. K. Vora - Orissa - FLOATING SERVICES LTD VS MV san FRANSCECO DIPALOLA - Gujarat - P. Sudhavenkata Lakshmi VS Sree Chakra Cotton Company, rep. by its Sole Proprietor, Puvvadisuresh - Andhra Pradesh - Behar Journals Ltd. VS H. K. Chaudhuri - Patna - Chemox Laboratories Ltd. VS Gujarat Narmada Valley Fertilisers Co. Ltd. - Dishonour Of Cheque - Boc India Limited VS Zinc Products And Co. Pvt. Ltd. - Patna
Search Results for "Sec 291 of the Company Act"
2001 0 Supreme(Raj) 331 • India - Rajasthan
P.C.TATIA
which is entitled u/Sec. 291 to exercise powers and do all the acts as the company is authorised to exercise and do – Article 48 ... C.P.C., Order 39, Rule 1 & 2; Companies Act, Sec. 291 – Articles 47 and 48 of the Schedule-I Table-A – Suit for declaration and injunction ... against defendant from convening extra ordinary general meeting of the share-holders of a company at a place other than the place ... The learned counsel for the appellant pointed out that Section....
2013 0 Supreme(Ori) 116 • India - Orissa
B.K.NAYAK
COMPANIES ACT, 1956 - Sec. 291 - Power to represent the company in a litigation can only be given by the Board of Directors of the ... Company by passing resolution to that effect in favour of the Directors or Principal Officer of a Company, who is well versed with ... the same in the pleadings. - In the present case held, the complaint petition filed through the Law Officer of the complainant-company ... company under Section 291 o....
2009 0 Supreme(Ori) 202 • India - Orissa
M.K.SHARMA, R.V.RAVEENDRAN
COMPANIES ACT, 1956 - Sec. 291 - Offence by company - Person liable - A Managing Director is prima facie in charge of and responsible ... whose negligence resulted in the offence under Sec¬tion 138 of the Act, being committed by the company. ... NEGOTIABLE INSTRUMENTS ACT, 1881 - Sec. 141 - Dishonour of cheques - Offence by Company - Persons to be held responsible - In addition ... Section 291 of ....
2004 0 Supreme(Guj) 142 • India - Gujarat
D.A.MEHTA
The provisions of Sec. 291 of the Act while entitling a Board of Directors of a Company to exercise all such powers provide, by way ... , 1956 (Central Act 1 of 1956) - Sec. 291 - Civil Procedure Code, 1908 - Order 6 Rule 14 & Order 29 Rule 1 - Signing of plaint ... The effect of such registration is as laid down in Sec. 34 of the Act i.e. the Registrar shall certify under his hand that the Company ... The prov....
2002 0 Supreme(AP) 450 • India - Andhra Pradesh
Criminal Procedure Code , 1973 - Sec. 482 - Negotiable Instruments Act – Sec. 141 - Sec. 138 – Dishonour ... her knowledge and is entitled to the benefit of Proviso to Sec. 141 (1) of the Act. ... of Cheque – Private complaint - -- Company filed four cases of Negotiable Instruments Act against Textiles Limited and its Directors ... ... ( 6 ) SEC. 291 of the Companies Act lays down that the Board ....
1964 0 Supreme(Pat) 87 • India - Patna
H.MAHAPATRA, TARKESHWAR NATH
INDUSTRIAL DISPUTES ACT, 1947 - SECTION 36 - REPRESENTATION BEFORE INDUSTRIAL TRIBUNAL - COMPANY AS EMPLOYER - AUTHORIZATION OF ... Whether a company, as an employer, can authorize a shareholder to act on its behalf before the Industrial Tribunal. ... It also held that a company, as an employer, can authorize a shareholder to act on its behalf before the Industrial Tribunal, as ... Under Sec.291 of the Indian Companies Act the Board....
2011 Supreme(Online)(KER) 19998 • India - High Court of Kerala
K.M.JOSEPH, M.L.JOSEPH FRANCIS, JJ
of contract regarding the sale of shares in the company. ... injunction against the respondent for felling rubber trees on property belonging to the first appellant company, claiming a breach ... Injunction - Property Dispute - Companies Act - Sections 30, 35 Fact of the Case: The appellants filed for an interim ... He would also point out that there is a resolution by the company to institute the suit itself under Sec.291 of the Companies Act and when there is no bo....
2004 0 Supreme(AP) 316 • India - Andhra Pradesh
B.SUDERSHAN REDDY, K.C.BHANU
The general powers of the Board of Directors of a company under Sec. 29 (1) (sic. 291 (1)) of the Companies Act, 1956, are subject to the provisions of the Act. ... A reading of Section 36 (1) and 291 (1) of the companies Act, makes it clear that the board of Directors of a Company are also bound to act in accordance with the memorandum and articles. ... Government Company, registered under the provisions of the co....
• India - Dishonour Of Cheque
D.H.WAGHELA
Sec. 138 of the Negotiable Instruments Act - Territorial Jurisdiction - Sec. 138, Sec. 141, Sec. 142, Sec. 177, Sec. 178, Sec. ... of complaints and setting aside of process issued by the trial Court in criminal cases under Sec. 138 of the Negotiable Instruments ... 204, Sec. 465 of the Code of Criminal Procedure - Summary Judgment Fact of the Case: The petitions involved quashing ... Ltd., was c....
1996 0 Supreme(Pat) 191 • India - Patna
S.N.JHA
Companies Act, 1956, Sec 291, 433(1)(a)(F), 434 & 439 - application for winding up filed by Area Sales Manager on the basis of power ... to Institute a suit on behalf of the Company-the Board of Directors did not pass any resolution authorizing Area Sales Manager to ... all the powers of the company unless a power to institute a suit is specifically conferred on a particular Director, he has no authority ... It is well settled by reasons of the provision of sec. 291 o....
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